Online Lender SoFi Rolls Out Hybrid Robo-Advisor

May 18, 2017

Traditional financial advisors have one more robo-advisor to compete with in SoFi. The San Francisco-based online lender is the latest to enter the lower-cost digital-advice arena. But with a twist: SoFi’s platform offers “unlimited” access to licensed financial advisors, according to a press release from the firm.

SoFi Wealth, the company’s brokerage and RIA advice platform, will invest clients in low-cost ETFs and includes automatic rebalancing for a range of individual and retirement accounts, SoFi says.

In addition to online and app-based access to the platform, SoFi’s clients will be able to call or chat with “non-commissioned, licensed financial advisors,” according to SoFi.

The platform is open to anyone with a minimum $500 initial investment or a $100 recurring monthly deposit and charges 0.25% in annual fees, the company says. What’s more, SoFi waives that fee for the first $10,000 invested and for SoFi borrowers for the duration of their loan, according to the press release.

SoFi’s hybrid approach is geared in part toward its existing client base of younger professionals, John Gardner, general manager of SoFi Wealth, says in the press release. The company cites prohibitively high prices of traditional financial advisors and lack of clear guidance from pure robo-advisors as reasons for millennials’ reluctance about investing for retirement.

SoFi is also working on further financial planning offerings, including advice for home-buyers, young families and couples, which it plans to roll out starting this summer, according to the press release.

SoFi’s launch of a hybrid robo coincides with the model’s growing popularity in the advice industry. In March, Wells Fargo announced plans to roll out a robo-advisor with access to its financial advisors, but the bank’s platform requires a $10,000 minimum and charges all clients a 0.5% annual fee.

Robo-advice pioneer Betterment, meanwhile, has expanded past its pure-robo approach and now offers optional access to live advisors — for an additional 0.15% to 0.25% fee.